What Should I Invest In?

Residential property, commercial property, business, shares. Here’s what I actually think about the four asset classes.

It’s one of the questions I get asked most often. 

“Jess, what should I invest in?” 

My answer is always the same: it depends. 

It depends on your financial position, your income, your goals, your risk appetite, and how much time you want to put in. But if I’m being completely honest, it also depends on what you actually have an interest in. The best investment is one you understand well enough to manage and stick with through the inevitable rough patches. 

What follows is how I genuinely think about the four main asset classes I talk to clients about every day. Not a textbook comparison. Just a practical breakdown of what each one involves, who it suits, and what you need to go in with your eyes open about.

Residential Property

Residential property has been a cornerstone of wealth creation for generations of Kiwis, and for good reason. 

The barrier to entry is lower than most people think, particularly if you already own your home and have equity to draw on. Banks understand residential property well, which means they’re generally comfortable lending against it. That’s a genuinely powerful advantage. The ability to use the bank’s money to build an asset, and amplify your returns in the process, is something that’s hard to replicate in most other asset classes. 

It’s also tangible. You can see it, improve it, and understand it. There’s a reason “safe as houses” entered the language. 

That said, I’d be doing clients a disservice if I didn’t flag the honest reality: I wouldn’t expect the extraordinary capital growth we’ve seen historically to continue at the same pace, at least not without meaningful improvement in wages and incomes. The fundamentals still stack up. But the days of doubling your money in seven years are harder to count on. 

The other thing that catches investors off guard is the ongoing cost. As a residential landlord, rates and insurance are your responsibility, and both are rising. That eats into yield more than it used to, so the numbers need to be run carefully before you commit. 

In terms of involvement, residential sits somewhere between passive and active. It’s not hands-off, but it’s not running a business every day either. 

Best suited to:

• First-time investors or those who already know property well 

• People with existing equity to deploy 

• Those comfortable with medium-level ongoing involvement .

Commercial Property 

Commercial property is a step up in complexity, and in potential. 

The barrier to entry is higher. You’ll typically need more deposit or equity, stronger cashflow, and a higher threshold of financial literacy to navigate it well. Banks assess it differently to residential, and the lending landscape is more nuanced. 

But for those who understand it, commercial can be a seriously strong asset class. 

The most obvious advantage is the lease structure. In most commercial arrangements, your tenant covers rates, insurance, and operating expenses. That changes the yield equation significantly compared to residential, where those costs sit with you. 

Here’s what I tell every client considering commercial property: you are not just buying a building. You are investing in the business occupying it. The quality of your tenant, the strength of their business, the length of their lease, and the likelihood of renewal are everything. Before you buy the property, you need to understand what’s going on behind the door. 

Commercial also tends to be more of a cashflow investment than a capital growth play. That’s not a negative, but it’s a different mindset to residential. The upside is that there’s often genuine opportunity to add value through improving tenancy, repositioning the asset, or negotiating better lease terms. 

Best suited to:

• Investors with a solid understanding of business and commercial environments 

• Those with sufficient equity and appetite for higher complexity 

• People who want stronger yield and fewer landlord obligations

Business Ownership 

A lot of people don’t think of their business as an investment asset. It absolutely is. 

Done well, a business builds real, tangible value over time, value you can eventually sell. It generates cashflow that can be reinvested or used to fund other assets. And for many business owners, it becomes the most powerful lever they have for building long-term wealth. 

One thing that sets business apart from the other three asset classes is control. Property investors can’t control the market. Share investors can’t control the market. But business owners have a genuine ability to influence their outcomes through strategy, leadership, innovation, and execution. That’s a significant advantage for people with the right skills and appetite. 

The trade-off is involvement. This is the most hands-on asset class of the four. It requires your time, your decision-making, and your energy, often for years. It carries risks the others don’t, including key person risk, industry risk, and the challenge of building something with transferable value that a buyer will actually pay for. 

What I see with a lot of business owner clients is that they’re brilliant at building the business but haven’t thought carefully about how to structure it for an eventual exit. That’s where good advice, both financial and legal, makes a real difference. 

The rewards, if you get it right, can be exceptional. But go in clear-eyed about what’s required.

Best suited to:

• Those with relevant industry expertise and an entrepreneurial mindset 

• People prepared to be actively involved over the long term 

• Clients who want cashflow now and capital value they can eventually sell

Shares and Managed Funds 

Shares and managed funds are the most passive investment option of the four. And with the right advice and a long enough time horizon, they can be very effective. 

The barrier to entry is the lowest of all four asset classes. You can start investing with very little, through a platform like Sharesies or InvestNow, or by simply making sure your KiwiSaver is set up in the right fund for your goals. 

The real power of shares is automation and compounding. You set a regular contribution, align your investment strategy with your risk profile and time horizon, and let time do the work. There’s no tenant to manage, no mortgage to service across multiple entities, no staff to lead. 

Rather than relying on the performance of a single property or business, you gain exposure to hundreds or thousands of companies across different markets, sectors, and economies. That diversification is built in. 

The challenge is the intangible nature of it. Markets are volatile, and watching your balance drop in real time can feel uncomfortable in a way that property doesn’t, because you’re not getting a monthly statement for your house. The investors who do well here tend to be those who understand what they’re invested in, have a long time horizon, and resist the urge to react to short-term noise. 

For most of our clients, shares play a supporting role rather than being the primary wealth-building vehicle. They’re the diversifier, the liquid buffer, the part of the portfolio that largely runs itself. 

Best suited to:

• Those who want a passive, automated approach to wealth creation 

• Investors with a long time horizon and ability to tolerate short-term volatility 

• People who want broad diversification alongside other asset classes 

The Most Important Point: Don’t Put All Your Eggs in One Basket 

I know that’s not a groundbreaking insight. But it’s worth saying clearly, because it’s something I see clients get wrong. 

The most financially resilient people I work with didn’t get there by picking the best asset class and going all in. They built wealth across multiple asset classes over time, so that when one area faces headwinds, the rest of the portfolio carries the load. 

A well-constructed portfolio balances:

• Growth 

• Income 

• Liquidity 

• Risk 

• Lifestyle goals 

Each asset class has strengths and weaknesses. The goal isn’t to pick the winner. The goal is to build a portfolio that works together. 

It’s also worth noting that different asset classes come with different tax implications, ownership structures, financing requirements, and succession planning considerations. Getting that right matters as much as picking the asset itself. That’s where good personalised advice, across finance, accounting, and legal, makes a real difference to your long-term outcome.

So, What Should You Invest In? 

The honest answer: it depends on you. 

What I’d encourage anyone reading this to do is not chase the asset class someone else is excited about. Get clear on your own position first. What equity do you have? What income do you have to service debt? How involved do you want to be? What do you understand well enough to manage properly? 

The right strategy starts with your goals, not the latest investment trend. 

If you want to talk through your own position, or pressure-test what you’re already doing, that’s exactly the kind of conversation we have at Vesta every day. 

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The above information is general in nature and does not constitute personalised financial advice. To discuss your own situation, speak with your financial adviser. At Vesta Finance & Advisory, we are happy to help.

Posted June 2026